Which of the following transactions does not affect cash during a period?
A) increase in amortization expense
B) payment of an accounts payable
C) issuance of bonds
D) purchase of a long-term investment

Question

Quizplus · Accepted Answer

Amortization expense is a non-cash expense. It represents the gradual reduction in value of an intangible asset or goodwill over time. It reduces net income but does not affect cash flow.

B, C, and D all affect cash during a period. Payment of accounts payable reduces cash, issuance of bonds increases cash, and purchase of a long-term investment decreases cash.

Which of the Following Transactions Does Not Affect Cash During